deal that continues a buildup by Fifth Third while removing a major competitor from the hotly contested Ohio market. Fifth Third, which is increasing its market share significantly in key Ohio markets this year through a series of branch acquisitions, would add $542 million in deposits and a still undetermined amount of loans and assets with the acquisition of NBD branches in Dayton and Columbus. The deal, which comes just a month before NBD is expected to complete its merger with First Chicago Corp., also represents a change in course for NBD. In the past, NBD's chief executive, Verne Istock, who is to run the new $124 billion-asset First Chicago-NBD Corp., has extolled the virtues of the Ohio market. In fact, rumors were common in the past few years that NBD was eyeing a merger with National City Corp. But in announcing the sale on Tuesday, Mr. Istock said NBD couldn't reach a sufficient market share in the Ohio markets to justify a continued presence. "This sale is part of NBD's continuing effort to rationalize our retail delivery network and focus on markets where we can gain adequate market share and provide superior financial returns to our shareholders," he said in a prepared statement. NBD has less than a 2% market share in Dayton and Columbus. Since entering those markets in 1990, NBD had unsuccessfully tried to acquire other banks and thrifts, but lost in the bidding for those companies, said NBD spokeswoman Renee Ahee. The sale is to include NBD's 17 Columbus offices, with $357 million in deposits, which would be merged with Fifth Third Bank's 38 branches there. NBD's eight Dayton offices, with $185 million in deposits, would be merged with Fifth Third Bank of Cincinnati. Terms of the transaction were not disclosed, but NBD is expected to receive $55 million to $75 million. For Fifth Third, the branch acquisition would be its fifth this year. Including other bank and thrift purchases, Fifth Third has bought more than $2.5 billion in deposits this year. The premium paid for deposits in the NBD deal is expected to top 12%, said Michael Durante, a bank analyst with McDonald & Co. in Cleveland. Nationwide, premiums paid for deposits are closer to 9%, he said. "The high premiums paid in Ohio are not so much for economic reasons, but scarcity value," he said. "If you want to be sizable in this state, there is not much left and you pay for it." NBD said the proposed sale had nothing to do with its pending merger with First Chicago. Instead, Ms. Ahee of NBD said the move was part of the bank's internal branch rationalization program, which is shedding full-service branches and adding supermarket branches. NBD still has a wholesale presence in Ohio, she added, including finance company offices. But Mr. Durante argued that the deal signals that First Chicago-NBD is not interested in the Ohio retail market. "At least for now, they are not going to do a midsize acquisition in Ohio," he said. "But who knows, maybe in the next merger cycle they could buy Keycorp."

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